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After Walgreens’s 1Q17 Results, Wall Street Remains Positive

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Dec. 4 2020, Updated 10:53 a.m. ET

Wall Street’s view of WBA

Let’s look now at Wall Street’s view of Walgreens Boots Alliance (WBA) after its fiscal 1Q17 results. Analysts have a positive to neutral view on Walgreens and has rated its stock a “2” on a scale of “1-strong buy” to “5-sell.”

Drugstore competitor CVS Health (CVS) has a slightly better rating of 1.9, but Rite Aid (RAD), WBA’s acquisition target, has a lower rating of 2.7.

Healthcare supply chain peers AmerisourceBergen (ABC) and McKesson (MCK) have inferior ratings of 2.6 and 2.8, respectively.

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Recommendations

WBA is covered by 25 Wall Street analysts. About 72.0% of them have recommended a “buy” for the stock, and 28.0% have recommended a “hold.” None of the analysts have recommended a “sell.” Rite Aid and CVS Health also haven’t received any “sell” ratings from analysts.

Wall Street’s take on fiscal 1Q17 results

Deutsche Bank and Jefferies reaffirmed their “buy” ratings for WBA stock after the company’s fiscal 1Q17 results.

Analyst Brian Tanquilut of Jefferies commented in a post-earnings note, “We remain bullish on WBA and believe that the company’s 1Q results underscore the positive aspects of its investment thesis that we believe will drive the stock higher over the course of 2017. WBA continues to progress in driving meaningful G&A leverage, just as volumes (driven by new contract wins) and cash flows are expected to ramp over the next few quarters. The RAD acquisition seems on track, with synergies likely to exceed mgmt.’s $1B guidance over time.”

If you want exposure to WBA, you can consider the iShares US Consumer Services (IYC). IYC invests 2.2% of its portfolio in WBA.

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